article thumbnail

How Do I Start A Small Business?

Strategy Driven

All the budding entrepreneurs and business people understand this phenomenon; thus they make the initial preparation and planning very compact, strong, and full-proof. Fixed Costs / (Average Price – Variable Costs) = Break-Even Point –. Introduction.

article thumbnail

The More Climate Skeptics There Are, the Fewer Climate Entrepreneurs

Harvard Business Review

They ensure that would-be climate entrepreneurs have less incentive to invent. A drug company must incur a large fixed cost to do the basic research, so it has strong incentives to predict what the demand for the drug will be if its research succeeds. Consider the example of a new drug for curing baldness.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

What BMW’s Corporate VC Offers That Regular Investors Can’t

Harvard Business Review

In 2012, one of us — Gregor Gimmy, a California-based serial entrepreneur and former IDEO consultant — accepted a new role at BMW’s corporate R&D headquarters. And the fixed cost from “touchpoint-to-pilot” are immense.

article thumbnail

Deliver Big Impact on a Small Budget

Harvard Business Review

One of the biggest challenges social entrepreneurs face is securing funding to set up their organizations and realize their ideas. Or can social entrepreneurs use the same techniques that for profit startup entrepreneurs use, and still make a big impact on a smaller budget?

article thumbnail

The Get-Big-Quick Fallacy

Harvard Business Review

When through our venture investment arm we seek to evaluate the profitability prospects of a young business, we look to see whether its team can credibly answer two questions: How will you charge enough for a transaction to cover the costs related to producing and delivering a good? Entrepreneurship Strategy'

article thumbnail

Does Your Startup Have a Spending Strategy?

Harvard Business Review

These spending choices require tradeoffs, so entrepreneurs must first develop a strategy for allocating limited resources across a wide range of available options. So not only were the current fees too weak to support his fixed costs, but future clients were turned off by his apparently excessive tastes.

article thumbnail

How Uber Explains Our Economic Moment

Harvard Business Review

So to cover his monthly fixed costs of student loan payments (on more than $100k in debt), rent, and health care he was driving for Uber. My driver’s job existed because a small group of venture-backed entrepreneurs created a technology platform that matched up cars and drivers with people who were willing to pay for a ride.